VP Jagdeo denies being beneficial owner of Kaieteur, Canje oil blocks

Apr 28, 2024 ExxonMobil, News, Oil & Gas

Kaieteur News – Vice President Bharrat Jagdeo has denied being one of the beneficial owners of the Kaieteur and Canje oil blocks. The Vice President was at the time responding to a question posed by Kaieteur News at his April 12, 2024, press conference.

Vice President, Dr. Bharrat Jagdeo

The leader was told that there are allegations that he is a beneficial owner to which he replied, “I am not one of the beneficial owners in the Kaieteur and Canje block,” before suggesting a headline for Kaieteur News’ story.

He said, “You see this is what so they do ask a very outrageous question like this and then tomorrow’s headline will be Jagdeo denies being an owner in the Kaieteur and Canje oil block.”

Jagdeo himself had promised to reveal to the public who the beneficial owners of these blocks are but never did.

In 2020, it was reported that the Vice President, who has oversight responsibility for the oil and gas industry, disclosed that his government will be making efforts to ascertain the beneficial owners of Guyana’s resources, with first priority being given to the owners of the nation’s oil blocks.

He had made the bold statement during a press conference held at the Arthur Chung Convention Centre.

Jagdeo had said that the government intends to have a greater understanding of the ownership structure of the companies with the said licences.

He had noted that this is important for transparency and for taxation purposes.

He had even pointed out that while a number of the companies which are operating Guyana’s oil blocks are registered in tax havens, including Barbados and the Cayman Islands, the government will ensure it goes after their information to ensure they pay their fair share of taxes.

However, he never delivered on his promise.

The following year another article was published with the headline, ‘PPP yet to honour promise to release list of beneficial owners of oil blocks.’

The article reminded that Government has failed to honour its promise to release the beneficial owners of the oil blocks offshore which include but are not limited to the Kaieteur, Canje, Orinduik, Kanuku, Demerara, Corentyne, and Berbice concessions.

Despite the article calling out the government for failing to keep its promise it did not respond and to date Jagdeo is yet to release the names of the beneficial owners.

The government’s posture has led to some oil and gas experts concluding that maybe the vice-president might be one of the beneficial owners of the blocks.

The Kaieteur and Canje oil blocks were awarded under questionable circumstances. They were handed out under the Donald Ramotar- led PPP administration just before the 2015 General and Regional elections.

The award had raised major red flags about the potential presence of corruption because the blocks are said to worth billions of US dollars but were given to two companies for meagre sums that in turn sold huge portions of these blocks for billions to major oil companies.

Mid-Atlantic was awarded the Canje oil block.

There were questions about the experience and wherewithal of the company to manage a deepwater block like Canje.

Another concern was about the amount of work Mid-Atlantic did after receiving the block, and before selling shares. Companies obtaining licences and quickly selling them to third parties without doing substantial work themselves, is considered a red flag.

After Mid-Atlantic got Canje, JHI Associates had acquired a stake in the Canje Block. JHI’s website listed a Canadian, John Cullen, as the CEO and Director. Global Witness (GW) had said that Cullen founded the company. It also noted that public documents from JHI do not list its shareholders. However, GW did state in its rescinded ‘Signed Away’ report that Edris Dookie and Cullen “have a history together of holding Guyanese oil licences, but not a history of finding any oil in the country.”

JHI said that it purchased seismic data packages on the basin after it acquired its share of the Canje Block, though 35 percent of the licence was sold to Exxon less than a year after Canje was awarded, according to GW. The public never learned how much Exxon paid for the share. Total Energy held a 35 percent stake in the block. Such blocks require experienced, capable companies with deep pockets, like ExxonMobil and Shell.

Like the Canje oil block, the Kaieteur block was first awarded to a company called Cateleya energy Limited (CEL), in 2015 by former President, Donald Ramotar.

That company then sold one-fifth of its 25 percent working interest in the offshore concession to Hess Corporation.

As a result of the transaction, Hess’ working interest moved from 15 percent to 20 percent, while Cataleya was left with 20 percent.

Meanwhile, the other partner on the block, Ratio Guyana Limited, held a 25 percent stake while ExxonMobil’s subsidiary, Esso Exploration and Production Guyana Limited (EEPGL), held 35 percent, thereby making it the operator of the block.

The sale between Hess and Cataleya was reported by Westmount Energy Limited, a UK investment firm that gives overseas firms opportunities to buy shares in the licenced operators of Guyana’s offshore blocks.